Why do so many americans live paycheck to paycheck despite high salaries and resonable cost of living?

[Will be deleted]

Some seems to say that over half americans, maybe up to 60-70% live paycheck to paycheck including many with salaries above $100k.

Yet even including things like cars, healthcare and student debt americans probably come ahead people of other countries due to higher wages and lower taxes and some things like houses even seems cheaper in USA than peer countries.

It do seems to me that americans live more extravegant than people in peer countries but is that the reason for financial struggle?

[bluesky66621]

atomicgirl a écrit :

bluesky66621 a écrit :

Credit cards were a thing for over 80 years. The difference is the shift of banking system that forcing everyone to be on credit if you want to buy a house, a car, hell even get a job. Credit report is a major thing for Americans. Without credit score, one would be less than nothing. If you want services then they look at your credit report if you qualify for services.

Without a credit score, you cannot even get a rental apartment. That's how bad Americans are now.

I think this is overstating things a bit. It's true that you need a credit score for a car and house, but not for renting or getting a job. Employers only care about references and work history, and landlords look at court records and references.

It depends on what job you looking for. A job working in a kitchen not so much. Anything that more important jobs, then yes. Landlords look at everything, not just listed above.

[Will be deleted]

AdahnGorion a écrit :

Its not really about how much you earn in most cases, its about how you think.
Most people use most of the salary on stuff (luxury, food, new car, big house, etc etc etc)

When they start to earn more, they just upgrade these parts.

People that have control over their economy set aside atleast 30% for investments alone and they use them before trying to get other things.
People that do not struggle with this, also try to live relatively cheap and set aside money for that + other essentials.

The hobbies that have are often low cost or provides you with a skill (say you pay to buy and learn an instrument or learning a new language)

Overall its about paying yourself, before paying others.

On high income in USA you can live far more extravegant than high income people can in Europe while still probably save significantly more, on other hand I don't know much about how low income people in USA get by with the limited welfare system.

[Hairy Hands Harry]

People just want to SPEND, SPEND ...

I worked with a guy in Engineering. We had 6 figure incomes and not in a super high cost of living area. His wife was a pharmacist with another 6 figure income. They do have two kids to spend on. But they spent everything. They had no real savings. He would take the kids to shopping or entertainment places every weekend. Spending big bucks. Because he hated to sit home.

[Boblin the Goblin]

bluesky66621 a écrit :

atomicgirl a écrit :

I think this is overstating things a bit. It's true that you need a credit score for a car and house, but not for renting or getting a job. Employers only care about references and work history, and landlords look at court records and references.

It depends on what job you looking for. A job working in a kitchen not so much. Anything that more important jobs, then yes. Landlords look at everything, not just listed above.

Jobs don't look at your credit score.

[Dutchgamer1982]

AdahnGorion a écrit :

Its not really about how much you earn in most cases, its about how you think.
Most people use most of the salary on stuff (luxury, food, new car, big house, etc etc etc)

When they start to earn more, they just upgrade these parts.

People that have control over their economy set aside atleast 30% for investments alone and they use them before trying to get other things.
People that do not struggle with this, also try to live relatively cheap and set aside money for that + other essentials.

The hobbies that have are often low cost or provides you with a skill (say you pay to buy and learn an instrument or learning a new language)

Overall its about paying yourself, before paying others.

while that helps...
if even GOOD incomes are denied a morgage on a house due houses having become so insane despite you easely being able to pay off that morgage in 30 years...

than you are forced to pay a rent much much higher than that morgage... many dutch spend over 60% of their income just on rent...
and you cant move cheaper.. as stated house shortage waiting lists from here to the moon..

and with such high montly expenses it is hard to save.. but even if you did.. fact remains that house prices rise 3x faster than wages.. you need to save more than you earn to ever catch up..

and our goverment has screwed up so much.. that likely it takes 20 years to become sligghly better.. even if they do every policy right in the coming 20 yewrs... by than many young people are so old nobody will give them a morgage anyway.

hence "the generation that never wlll own"

[Dutchgamer1982]

AdahnGorion a écrit :

Will be deleted a écrit :

In USA a high paying job Maybe give you $6-11k a month after taxes similar jobs in Europe is maybe 3€ to 5k€ a month so at that point USA looks pretty good.

On low incomes However I suspect it look a lot worse for USA.

That is a rather poor way to look at it.
I pay first almost 50% in tax, then I pay extra (high income tax) for the remaining salary.

Americans don´t do that, but they have to pay for healthcare, educations, etc.
The point here is.. you have to look much broader on the scope of this.. overall people in my country earn more (median) than Americans do.

Americans have cheap foods however.. like really dirt cheap things..

that last part is not true anymore..
was true..
but food prices in usa have grown A LOT..

sure eggs and milk and butter have in 2 years time also doubled in price in my country..
but thats nothing vs usa... like 50 dollar for a kilo of low quality ground beef kind in a budgetstore kind of madness..
fresh produce really has gone trough the roof...

sure there is still cheap junk in usa... but it is no longer as cheap as it was with prices 7 times higher as they were... and eating that junk.. will just cost you insane healthcare expenses ,later down the line.

just look at big mac prices..

used to be usa big mac 2 dollar, nethrlands 5 euro
now its usa big max 15 dollar.. netherlands 8 euro..

[Will be deleted]

AdahnGorion a écrit :

Will be deleted a écrit :

In USA a high paying job Maybe give you $6-11k a month after taxes similar jobs in Europe is maybe 3€ to 5k€ a month so at that point USA looks pretty good.

On low incomes However I suspect it look a lot worse for USA.

That is a rather poor way to look at it.
I pay first almost 50% in tax, then I pay extra (high income tax) for the remaining salary.

Americans don´t do that, but they have to pay for healthcare, educations, etc.
The point here is.. you have to look much broader on the scope of this.. overall people in my country earn more (median) than Americans do.

Americans have cheap foods however.. like really dirt cheap things..

Those european and american incomes are after taxes. Sure americans need to pay for more stuff but those high paying jobs tend to come with health insurence and 401k matching so it is even better compared to the low wage americans who probably don't get those things.

Basically the higher salary you have the better USA becomes compared to other countries.

[Hairy Hands Harry]

SlowMango a écrit :

bluesky66621 a écrit :

It depends on what job you looking for. A job working in a kitchen not so much. Anything that more important jobs, then yes. Landlords look at everything, not just listed above.

Jobs don't look at your credit score.

Yes they do. For career level jobs, they take a good look at you. Not for a fast food job.

[Dutchgamer1982]

Will be deleted a écrit :

AdahnGorion a écrit :

That is a rather poor way to look at it.
I pay first almost 50% in tax, then I pay extra (high income tax) for the remaining salary.

Americans don´t do that, but they have to pay for healthcare, educations, etc.
The point here is.. you have to look much broader on the scope of this.. overall people in my country earn more (median) than Americans do.

Americans have cheap foods however.. like really dirt cheap things..

Those european and american incomes are after taxes. Sure americans need to pay for more stuff but those high paying jobs tend to come with health insurence and 401k matching so it is even better compared to the low wage americans who probably don't get those things.

Basically the higher salary you have the better USA becomes compared to other countries.

eh no.. our median wage of 44k euro is BEFORE taxes...
(our average wage is a little higher at 48kl)

usas average wage (so median will be worse) is 33k euro also before taxes

[Will be deleted]

I know scandinavia because I live there, but the tech people and such seems to be much better of than they are in scandinavia in basically every way except like job security and maybe work life balance.

[Boblin the Goblin]

Hairy Hands Harry a écrit :

SlowMango a écrit :

Jobs don't look at your credit score.

Yes they do. For career level jobs, they take a good look at you. Not for a fast food job.

They don't. Wife has a career level job, they didn't ask for any information related to getting that information.

[Dutchgamer1982]

AdahnGorion a écrit :

Dutchgamer1982 a écrit :

while that helps...
if even GOOD incomes are denied a morgage on a house due houses having become so insane despite you easely being able to pay off that morgage in 30 years...

than you are forced to pay a rent much much higher than that morgage... many dutch spend over 60% of their income just on rent...
and you cant move cheaper.. as stated house shortage waiting lists from here to the moon..

and with such high montly expenses it is hard to save.. but even if you did.. fact remains that house prices rise 3x faster than wages.. you need to save more than you earn to ever catch up..

and our goverment has screwed up so much.. that likely it takes 20 years to become sligghly better.. even if they do every policy right in the coming 20 yewrs... by than many young people are so old nobody will give them a morgage anyway.

hence "the generation that never wlll own"

I can´t say for people outside Scandinavia, but here just about anyone with a basic education can afford and get a house with cheap loands..
A median family with two kids could easily loan 270k euro for a house and still have lots of space in the economy.

It all depends on where you live, but salaries go rahter high up if you live in one of the larger cities.
The Dutch are in another situation and they don´t have a similar system.

In Netherlands higher educations are not free ie. Healthcare is insurance based.

for a few years we had a student loan system.. but now it is back to "complete your education in 4 years and you get it back" granted there are holes if i go in detail

our schools are 15-25k a year for foreigners... local dutch pay only 1.2-1.8k a year (which is also why schools here have so many foreign students schools likle them as they earn more on them.. luckely the govement has started quiota's and a "dutch students first" rule meaning that
iuf not enoigh student spots dutch now take priority.

and well why a friend moved to norway and why I consider it..

norway has wages about twice what we do in the netherlands.
but your houses cost only 30%
sure groceries and such cost 1.5 times more than in the netherlands.. but with twice thw wage and such low housing costs you can afford it.

frriend bnought a house in norway for 150k euro that was absolutely massive.... here such a house would have cost 700-900k and he would never even have qualified for a morgage over 230k which would not even been enough to buy a flat in the ghetto.

[Will be deleted]

Like USA upper middle class is significantly more well of than upper middle class is in Scandinavia based on what I've seen, middle class maybe about equal and much worse I guess for rest.

OECD say productivity in Norway, Denmark and Sweden is about similar or somewhat higher per worked hour than USA, so probably not a bad comparison.

[Dutchgamer1982]

Will be deleted a écrit :

Like USA upper middle class is significantly more well of than upper middle class is in Scandinavia based on what I've seen, middle class maybe about equal and much worse I guess for rest.

where you draw the line upper and lower middle class?

for me lower class = unemployed, uneducated, and low level educated workers

middle class = bachalor, master and doctorate educated

upper class = living of investments, intheritance, other peoples wages

if you wanted to make an upper middle class group.. to me that be like dentists, surgeons, members of parlement and such. the like 0.2% that earns here over 100k
but that still lives of a wage..

and how you measure better... yeah usa houses are a lot bigger.. but you can litterly poke holes in the walls with your fist... ours are solid and much better build...
and than there is whats around it... boy are their cities depressing to live in...
just strolling on foot from your house to a pub to grab a drink.. to church.. or to eat something in restaurant.. forget it.. look outside and all you see is gray and more gray from all the roads cars and parkingspots

[Will be deleted]

Dutchgamer1982 a écrit :

Will be deleted a écrit :

Like USA upper middle class is significantly more well of than upper middle class is in Scandinavia based on what I've seen, middle class maybe about equal and much worse I guess for rest.

where you draw the line upper and lower middle class?

for me lower class = unemployed, uneducated, and low level educated workers

middle class = bachalor, master and doctorate educated

upper class = living of investments, intheritance, other peoples wages

if you wanted to make an upper middle class group.. to me that be like dentists, surgeons, members of parlement and such. the like 0.2% that earns here over 100k
but that still lives of a wage..

Top 10%, although I guess at around top income 25% USA is better than Scandinavia in terms of finances. Basically if you make $100k or more you probably better of in USA than in Scandinavia, even taking account for the extra stuff you may have to pay for and the more extreme the salary the better USA becomes.